Business Plan for Parties and Pizzas Fast Food Restaurant

This business plan outlines the establishment of Parties and Pizzas, a fast food restaurant that specializes in pizza, pasta, and other snacks. The plan includes a market analysis, product description, marketing plan, operational plan, and financial plan.

Running head: BUSINESS PLAN
Business Plan
Name of the Student:
Name of the University:
Author’s Note:

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BUSINESS PLAN
Table of Contents
Executive Summary.........................................................................................................................2
Business/ Service Description.........................................................................................................3
Overview of the Business............................................................................................................3
Legal Form...................................................................................................................................3
Mission Statement.......................................................................................................................3
Goals and Objectives...................................................................................................................4
Management................................................................................................................................4
Product.............................................................................................................................................4
Description...................................................................................................................................4
Need for the Product....................................................................................................................5
Uniqueness and Competitive Advantage of the Product.............................................................5
Barriers to Entry..........................................................................................................................5
Market Analysis...............................................................................................................................6
Target Market..............................................................................................................................7
Competition.................................................................................................................................7
Marketing Plan.................................................................................................................................7
Marketing Mix.............................................................................................................................7
Operational Plan..........................................................................................................................9
Production Method and Control..................................................................................................9

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Location.......................................................................................................................................9
Permits and Licensing..................................................................................................................9
Risk Management and Personnel.................................................................................................9
Supply chain Credit Policies......................................................................................................10
Accounting System....................................................................................................................10
Financial Plan................................................................................................................................11
Sales Forecast............................................................................................................................11
Profit and Loss Statement..........................................................................................................12
Reference.......................................................................................................................................17

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Executive Summary
The main purpose of this assignment is to develop a business plan which will be on a fast
food restaurant business. The business which is proposed will be providing pizza, pasta, deserts
delights and similar snacks. The name of the business as proposed will be Parties and Pizzas.
Initially the plan of the owners to open three shop locations which will be situated in populated
cities of USA. The business plan will be containing the basic product which the business will be
offering its targeting customers, ranges of prices to be charged for the products, operational plan
of the business and also a plan which includes financial investments which are required to get the
business running. In addition to this, a market analysis will be conducted to judge the level of
competition in the market for fast food business restaurants.

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BUSINESS PLAN
Business/ Service Description
Overview of the Business
The business which is proposed in this plan is a fast food restaurant business which will
be opening three stores in USA and the preferred location for opening such a restaurant is New
York as per the plan of the owners. The restaurant which is to be set up will be specializing in
pizza, pasta which is a celebrated Italian food (Min & Min, 2013). The restaurant is intended to
provide other variety food as well as noodles, breakfast combo meals and beverages. In addition
to this, the restaurant will also provide for party services which includes catering, party planning,
decorations for birthday parties, kitty parties, college graduating celebration.
Legal Form
As per the plan of the owners, the business will be established in a company form of
business which will be private limited and all the necessary contributions which are to be made
for the start-up costs and day to day operations of the business will be provided by the owners of
the business (Österle, 2013). The various other legal expenses which to be incurred before the
business starts is legal costs of registration and also acquiring the license of the business.
Mission Statement
The mission of the company as per the plan of the owners will be to provide best quality
of foods and services to the customers at a reasonable price. As there are a lot of competitors the
management plans to offer free beverages as per the option of the customer with every meal
combo taken by the customers (I. Williams Jr L. Morrell & V. Mullane, 2014). The mission
statement of the company will also include the policy that the restaurant will treat every
customer respectfully and on a priority basis so as to satisfy their every need.

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Goals and Objectives
The goal of the business will be to create a brand name for the business with the service
and quality of food provided. The satisfaction level of the customers will be considered an
important aspect of the policies of the business (Awadh & Alyahya, 2013). The objectives of the
business are specified below in details:
 To provide best quality of food and services to the customers.
 To ensure that all the needs, feedbacks and complaints are adhered to and ensure the
customers are satisfied with the services provide by the business.
Management
As per the plan of the owners, all the major decision of the restaurants will be taken by
the owners and the day to day management of the restaurants will be on the managers of the
respective restaurants. The staff will be comprising of cooks, support staffs, waiters, cleaners.
Every restaurant will be having a separate division for party planners which will be providing
services such as organizing small parties such as birthday parties and similar other kinds of
parties.
Product
Description
As per the plan of the owners, the basic product which the business will providing will be
pizza, pasta, ginger breads, French fries and a variety of beverages. The pizzas will be the main
attraction as it is very popular food among the teenagers and even adults. The pizzas of the
restaurants will be coming in three sizes which are small, medium and large. The customer will
be allowed to choose the toppings of the pizzas and also the preference of the crust which can be

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thin or regular. The variety of pizzas options and innovative combinations will be attracting a lot
of customers as per the vision of the owners.
Need for the Product
The restaurant making pizzas as their main attraction is due to the fact that the owners are
of the view that other restaurant which offers pizzas do no have the variety and even if they do
such are quite costly. In addition to this, pizzas are considered to be most preferred snacks, after
burgers and therefore the market is suitable. The teenagers love their pizzas and prefer them as
snacks and even as dinner in some cases.
Uniqueness and Competitive Advantage of the Product
The main product of the restaurant will be having a large variety of ranges which can also
come with different toppings as per the preference of the customers. In addition to this the
different innovative flavors will be making the pizzas of the restaurant unique. In addition to this
the restaurant have attractive combo meal offers which comprises of a pizza, fries, coke floats
depending on the combo meal type (West, Ford & Ibrahim, 2015). The restaurant offers free
beverages with combo meals as per the choice of the customers. This will be an effective
strategy as this will surely attract customers and help the business to gain a competitive
advantage in face of tough competition from other restaurants. In addition to this, the party
planning activities will be adding to the revenues of the business and also promoting the food
items of the business as which will help the restaurant to survive tough competition (Dirisu,
Iyiola & Ibidunni, 2013).
Barriers to Entry
The fast food industry is dominated by established brands such as McDonalds, Subway,
Dominos, Burger Kings and similar other restaurant chains. Therefore, the owners expect that

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entering into such a market will not be easy (Geroski & Jacquemin, 2013). The barriers which
the business might face are given below:
 Excessive Competition in the market leading to low profitability.
 Lack of availability of resources to finance and start a business.
 Getting a proper location to start the business.
The barriers which are mentioned above can be overcome by the restaurant by developing a
plan to achieve competitive advantage as in case of Parties and Pizzas will be the variety of
pizzas on offer (Kappes & Merkert, 2013). In addition to this, the business will also be providing
party management services which the owners reckon will provide enough revenues for the
business to survive through the initial period. As for the resources to finance the business will be
provided by the owners themselves and also they might take a loan from banks as the case may
arise.
Market Analysis
As per the market analysis of Restaurant chains and fast food business, the owners
anticipate that even though the market has tough competition and highly competitive, there is
still opportunity for establishing a business and also attaining growth in the same. The owners of
the business also recognize that the business will be competing with brands like McDonalds,
Dominos, Burger King, Subway which are established players in the market and the products of
such companies are popular among the customers. The owners want to establish the same place
for the restaurant in the market (Kwok & Yu, 2013). There is potential for growth once the
business is established in the market. The owners are aware of the fact that the currently the fast
food industry accounts for $198.9 billion in US market. This is forecasted to further increase to

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about $ 223 billion by 2020. Therefore, there is wide scope of growth in US market (Chen &
Elston, 2013).
Target Market
The target market of the business will be teenagers as they are the customers who are
mostly attracted to fast food items like pizza and burgers. In addition to this, pizzas are preferred
in US for any occasions be it family union or some celebrations or as a casual snack. Therefore,
the owners of the restaurant expect that maximum part of the revenue will be generated from the
customers falling in the age group of 14- 24 years of age (Tanner & Raymond, 2015).
Competition
The owners of the business also recognize that the business will be competing with
brands like McDonalds, Dominos, Burger King, Subway which are established players in the
market. The main advantage such restaurant have is that they are already established in the
business and already the products are well recognized in the market (Kirzner, 2015). Moreover,
these restaurant chains have already developed a brand and brand loyalty among the people.
Marketing Plan
The marketing plan for the restaurant is one of the areas which the owners plans to invest
effectively as such are the activities which will be promoting the products of the company
(Westwood, 2016). The owners plan to use the marketing mix concepts to clearly outline the
marketing activities of the business.
Marketing Mix
1. Product: The product of the company comprises of a variety of pizzas and pasta which
the business can offer to its customers. The products of the business will also be

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consisting of various combo meals and a variety of beverages which will be on offer. The
business will be promoting the product by offering the best quality of the food at a
reasonable price. Such an activity also causes promotion of products and attracts potential
customers into the restaurant (Huang & Sarigöllü, 2014). The products will be freshly
prepared in each of the store and no leftovers will be kept for use. This approach of the
business will ensure the quality and once quality is maintained, customers are naturally
attracted
2. Price: The price as per the owners will be set by analyzing the costs which the business
incurs in the preparation of pizzas and other food items and the prices which are charged
by rival restaurants like dominos or McDonalds are also to be analyzed (Hanssens et al.,
2014). The prices which is set by the business will be lower than the prices charged by
the competitors even though the business is earning lower profits. The aim of the
business will be to establish itself in the market. The aim of the business is to provide
best quality of products at a reasonable price.
3. Promotion: The promotional activities of the business will be comprising of television
advertisement, social media advertisements and other forms of advertisement. Parties and
Pizzas will be over the social media site for advertisement purpose and the company will
also be publishing the menu of the Parties and Pizzas in social media to create a buzz
among the customers and teenage generation (Khan, 2014). Besides this, the business
also has party services which will also be promoting the products of the business as per
the expectation of the owners of Parties and Pizzas.

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4. Place: The place of operation which the owners wants to open the restaurant is New
York as the city has most population and the people in New York appreciate good quality
of food.
Operational Plan
Production Method and Control
The production or preparing of all food items of the restaurant will be done in the
restaurant itself. As the main product of the company is pizza which will not be taking much
time in preparation wise therefore it will be prepared as soon as the order for the pizza is laced
by the customer. This will ensure the freshness and quality of the product and also will be able to
attract customers effectively (Appelroth, 2015). As per the plan of the owners the control of the
restaurant will be handled by the managers of the respective restaurants. The owners also plan to
visit each restaurant for surprise examination of the working environment.
Location
As per the plan of the management, the location of the restaurant will be preferably in
New York. The owners prefer a main road location which has access to local supermarket within
10 mins or so and also is populated for the sales generation activities of the restaurant. In
addition to this, the restaurant location will be such that it is accessible by potential customers.
Permits and Licensing
The restaurant before it starts its operation needs to acquire licensing from the local
authorities (Kaushik, 2013). The license which is received by the restaurant will be the proof that
the restaurant can operate in that particular location. In addition to the company also needs to
acquire licensing which certifies that the food of the company is appropriate and not affecting the
health of any customer of the restaurant.

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Risk Management and Personnel
The major risks which Parties and Pizzas will be facing is from the competitors of the
business, the competitors pricing and other policies will be affecting the restaurant business. As
per the expectation of the owners, the risks which the business faces can be handled effectively if
proper planning is involved and a competitive advantage is developed for the restaurant. The
owners anticipate that the variety of pizzas and the toppings which the restaurant has on offer,
can create a competitive advantage for the business and help in reduction of risks from
competitors (McNeil, Frey & Embrechts, 2015). Then there is the risk of wastage of resources
which can be reduced by effective inventory control which needs to be supervised by the
managers of the restaurant.
The personnel of the restaurant which are to be recruited are chefs, support staffs,
cleaners, party planners, managers. The managers will be responsible for controlling the
activities and supervision of the restaurant.
Supply chain Credit Policies
The supply chain refers to the sources through which the business will be getting raw
materials such as vegetable, meat and other essential products. The owners plan to purchase
stocks in bulk and store the same in the restaurants. The inventory of stocks will be under the
control of the managers and he will be responsible for supervising the stock to ensure that there
is no wastage. The restaurant will be allowing credit services for party hiring only. Where a party
is to planned the food sale can be provided on a credit basis as per plans of the owners of Parties
and Pizzas.

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Accounting System
The management of accounting records will be handled by the accountant of the business
and will be supervise and review by the owners of the company. Th restaurant consolidates the
statements prepared by all three restaurants and plans to present a consolidated statement which
will display the performance of the entire organization.

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Financial Plan
Sales Forecast
(1) SALES FORECAST
Year 0 2018 2019 2020
Projected Sales 3,00,000€ 3,45,000€ 4,14,000€
(b) Cost of goods 1,80,000€ 1,89,000€ 2,07,900€
(2) CASHFLOW FORECAST
Preop
Year 0 2018 2019 2020
CASH INFLOWS
Cash from Sales 3,00,000€ 3,45,000€ 4,14,000€
Owner's loans 50,000€ 50,000€ 50,000€ 50,000€
Capital Employed 1,00,000€ 1,50,000€ 1,50,000€ 1,50,000€
Other cash inflows
TOTAL CASH INFLOW 1,50,000€ 5,00,000€ 5,45,000€ 6,14,000€
CASH OUTFLOWS
Payments for materials 1,80,000€ 1,89,000€ 2,07,900€
operating expenses ( )
Premises (rent, rates) 7,500€ 7,500€ 7,500€
Wages and salaries 40,000€ 48,000€ 60,000€
General expenses 1,000€ 1,200€ 1,500€
Interest and bank charges payable
Lease payments
Corporation Tax 5,550€ 11,010€ 18,030€
Market survey costs 4,000€ 4,800€ 6,000€
Other preliminary expenses 1,000€ 1,200€ 1,500€
capital expenditure
Plant and other capital expenditure 65,000€ 65,000€ 65,000€
financing repayments
Loan repayments 5,000€ 5,000€
TOTAL CASH OUTFLOWS 3,04,050€ 3,32,710€ 3,72,430€
Cash flow summary
NET CASHFLOW FOR PERIOD 1,50,000€ 1,95,950€ 2,12,290€ 2,41,570€
OPENING CASH BALANCE -€ 1,50,000€ 3,45,950€ 5,58,240€
CLOSING CASH BALANCE 1,50,000€ 3,45,950€ 5,58,240€ 7,99,810€

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The sales forecast for a period of three year is given above which shows that the business
can anticipate a net cash flow of 195950. The assumptions which are made by the management
of the company is that the sales of the business will be increasing at a 15% rate in 2019 whereas
the sales will further increase by 120% in 2020. The owners expect that the business will be
attaining growth in the coming years. Similarly, the costs of the business will also be increasing
in in coming years due to inflation
Profit and Loss Statement
(4) PROFIT AND LOSS FORECAST
Preop
Year 1 2 3
Revenue 3,00,000.00$ 3,45,000.00$ 4,14,000.00$
Cost of sales 1,80,000.00$ 1,89,000.00$ 2,07,900.00$
Gross profit 1,20,000.00$ 1,56,000.00$ 2,06,100.00$
Gross Margin 2,87,050.00$ 3,19,310.00$ 3,71,930.00$
Expenses/overheads
Leased Premises Rent 7,500.00$ 7,500.00$ 7,500.00$
Staff Wages 40,000.00$ 48,000.00$ 60,000.00$
Administrative Expenses 1,000.00$ 1,200.00$ 1,500.00$
Communication Expenses 12,000.00$ 14,400.00$ 18,000.00$
Administrative Salaries 12,000.00$ 14,400.00$ 18,000.00$
Marketing Expenses 3,000.00$ 3,600.00$ 4,500.00$
Rates 4,000.00$ 4,800.00$ 6,000.00$
Insurance 2,000.00$ 2,400.00$ 3,000.00$
Other general expenses 10,000.00$ 12,000.00$ 15,000.00$
Interest 1,000.00$ 1,200.00$ 1,500.00$
Market survey 5,000.00$ 5,000.00$ 5,000.00$
Prelim expenses 4,000.00$ 4,800.00$ 6,000.00$
Total expenses/overheads 1,01,500.00$ 1,19,300.00$ 1,46,000.00$
Profit before tax 18,500.00$ 36,700.00$ 60,100.00$
Tax @ 30% 5,550.00$ 11,010.00$ 18,030.00$
Profit after tax 12,950.00$ 25,690.00$ 42,070.00$
Transfer to reserves 18,500.00$ 36,700.00$ 60,100.00$
ROC 13% 17% 28%

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Assets 2018 2019 2020
Current Assets
Cash 1,95,950.00$ 2,12,290.00$ 2,41,570.00$
Accounts receivable 90,000.00$ 1,03,500.00$ 1,24,200.00$
Total current assets 2,85,950.00$ 3,15,790.00$ 3,65,770.00$
Fixed (Long-Term) Assets
Furniture 12,000.00$ 9,500.00$ 7,000.00$
Freezers 18,000.00$ 14,400.00$ 10,800.00$
Equipments 22,500.00$ 18,000.00$ 13,500.00$
Utensils 12,500.00$ 10,000.00$ 7,500.00$
(Less accumulated depreciation) 13,100.00$ 13,100.00$ 13,100.00$
Total fixed assets 51,900.00$ 29,300.00$ 18,700.00$
Total Assets 3,37,850.00$ 3,45,090.00$ 3,84,470.00$
Liabilities and Owner's Equity
Current Liabilities
Accounts Payable 80,000.00$ 1,00,000.00$ 90,000.00$
Accrued Rent 7,500.00$ 7,500.00$ 7,500.00$
Bank Charges Payable 5,000.00$ 5,000.00$ 5,000.00$
Income taxes payable 5,550.00$ 11,010.00$ 18,030.00$
Accrued salaries and wages 40,000.00$ 48,000.00$ 60,000.00$
General Expenses 1,000.00$ 1,200.00$ 1,500.00$
Current portion of long-term debt 50,000.00$ 45,000.00$ 40,000.00$
Total current liabilities 1,89,050.00$ 2,17,710.00$ 2,22,030.00$
Long-Term Liabilities
Long-term debt 50,000.00$ 45,000.00$ 40,000.00$
Less: Loan Repayment 5,000.00$ 5,000.00$
Total long-term liabilities 50,000.00$ 50,000.00$ 45,000.00$
Owner's Equity
Owner's investment 1,50,000.00$ 1,50,000.00$ 1,50,000.00$
Net Profits 12,950.00$ 25,690.00$ 42,070.00$
Reserve and Surplus 18,500.00$ 36,700.00$ 60,100.00$
Total owner's equity 1,81,450.00$ 2,12,390.00$ 2,52,170.00$
Total Liabilities and Owner's Equity 4,20,500.00$ 4,80,100.00$ 5,19,200.00$
{42}
Common Financial Ratios Year 1 Year 2 Year 3
Debt Ratio (Total Liabilities / Total Assets) 0.71 0.78 0.69
Current Ratio (Current Assets / Current Liabilities) 1.51 1.45 1.65
Working Capital (Current Assets - Current Liabilities) 96,900 98,080 1,43,740
Assets-to-Equity Ratio (Total Assets / Owner's Equity) 1.86 1.62 1.52
1.32 1.26 1.06
Balance Sheet

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Breakeven Analysis
Breakeven Sales Value = average fixed cost/% contribution
Average fixed cost 73360
Contribution % 50%
Revenue Contribution Fixed Cost Profit
73360 36680 73360 -36680
146720 73360 73360 0
183400 91700 73360 18340
220080 110040 73360 36680
50000 100000 150000 200000 250000
-60000
-40000
-20000
0
20000
40000
60000
80000
100000
120000
-36680
0
18340
36680
73360 73360 73360 73360
36680
73360
91700
110040
Contribution
Fixed Cost
Profit
Figure 1: (Chart showing Breakeven Analysis)
Source: (Created by Author)

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BUSINESS PLAN
Particulars 2018 2019 2020
Cash Flow from Operating Activities
Sales Revenue 300000 345000 414000
Cost of sales 180000 189000 207900
Leased Premises Rent 7500 7500 7500
Staff Wages 40000 48000 60000
Administrative Expenses 1000 1200 1500
Communication Expenses 12000 14400 18000
Administrative Salaries 12000 14400 18000
Marketing Expenses 3000 3600 4500
Rates 4000 4800 6000
Insurance 2000 2400 3000
Other general expenses 10000 12000 15000
Interest 1000 1200 1500
Market survey 5000 5000 5000
Prelim expenses 4000 4800 6000
Tax @ 30% 5550 11010 18030
Total Cash Inflow/(Outflow) from Operating Activities 12950 25690 42070
Cash Flow from Investing Activities
Total Cash Inflow/(Outflow) from Operating Activities 12950 25690 42070
Cash Flow from Financing Activities
Loan from Bank 50000 50000 50000
Interest Expense
Total Cash Inflow/(Outflow) from Operating Activities 50000 50000 50000
Net Cash Increase/Decrease 62950 75690 92070
Add : Opening Balance 133000 136600 149500
Closing Cash Balance 195950 212290 241570
Projected Cash Flow Statement

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BUSINESS PLAN
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